Wellard launches largest livestock ship

The M/V Ocean Shearer, capable of carrying 20,000 head of cattle and worth US$90m ($117m), set sail off China last week following a ceremonious naming, dominated by talk of the lucrative doors about to be opened for producers of British breed cattle in Australia.

The Shearer's first trip will be to Brazil to collect a shipment of lightweight bulls destined for Turkey, however Portland, Victoria, will be her longer-term base.

Following approvals last year of a live cattle trade to China, Wellard expects the Shearer to deliver at least two shipments of Australian cattle before the end of 2016.

While Elders has sent two plane shipments of live Angus cattle to China, a lack of infrastructure in the Asian economic hub has so far held back the business.

Chinese biosecurity regulations mean that all Australian live cattle can only be kept and processed in new feedlots and meatworks purpose-built for the trade and located no more than 50 kilometres from the coast.

In a joint venture with Chinese-owned company Fulida, Wellards is building two feedlots - 6000 head to start with but increasing to 15,000 head - and an abattoir.

The feedlots will fit the size of Wellard vessels the Ocean Swagman and Ocean Outback but the expansion will see the Shearer kick in.

The facility, east of Beijing, is expected to be ready by the end of the year, and at least two other Chinese companies are also in the process of constructing similar coastal plants aimed at capitalising on the opportunity to bring in Australian live cattle.

Wellard chief executive officer Mauro Balzarini said his company's investment in China and the Shearer "shows our confidence in the live trade industry to all stakeholders in Australia and around the world".

"Live export has never been the mainstay in Australia but that is changing," he said.

"In the next 12 months, China will start to take serious numbers - it will reach 700,000-1 million head very quickly.

"Forecasts are that China will eventually consume the same amount of beef per capita as Australia and given it has 1.3 billion people, that 1m head from Australia will be a drop in the ocean."

Wellards expects to be looking for mostly 12-14 months feeder cattle, and British breeds.

Live cattle to China must also be free from blue-tongue disease.

Whether or not southern Australia is ready remains to be determined.

Mr Balzarini acknowledged "big promises have been made to southern Australian producers in the past that have not eventuated".

His experience was that "you have to buy from Australian producers three times before they will consider the market as serious".

Wellard's chief operating officer Scot Braithwaite said the company purchased and shipped 7000 head of European cattle from Portland two years ago to Vietnam and "the industry down there has been very keen since for us to return".

How will it affect the processing game in Australia?

Mr Balzarini said there was space for everyone, but that the domestic market may just be left to Australian processors.

The simple fact was the cost of doing business in Australia was prohibitive, he said.

The cost of building the feedlots and abattoir in China was a seventh of what would be needed to do the same in Australia, he said.

Other industries had been through the process - beef was certainly not the first to send factory business offshore.

p Shan Goodwin travelled to China as a guest of Wellards.

The 12,500m2 Kelpie is expected to be complete next year.

Dimensions of the Shearer

Length: 189.3m

Breadth: 31m

Gross tonnage: 36,028t

Livestock area: 23,500m2

Number of decks: 9

Draft: 8.85m

Freshwater capacity: 350t

Freshwater production: 800t/day from five reverse osmosis units

Fodder capacity: 3000t

Ventilation: Velocity greater than 0.5m/second across all pen areas. Greater than 100 air changes per hour.

Speed: 18kn